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Right now, graduates enrolled in the federal governments student loan Income-Based Repayment Plan make monthly payments of 15 percent of their discretionary income and all debt is forgiven after 25 years. Congress has already passed a law to change that program to require students to make payments of just 10 percent of their monthly discretionary income and to forgive the loan after just 20 years. That law will take effect in 2014 unless Obama has his way. The president would like to promote the start date to 2012. Hmm. What else happens in 2012?
Discretionary income is money you have after you've paid off all of your bills. Discretionary income is income after subtracting taxes and normal expenses (such as rent or mortgage, utilities, insurance, medical, transportation, property maintenance, child support, inflation, food and sundries, &c.) to maintain a certain standard of living.[5] It is the amount of an individual's income available for spending after the essentials (such as food, clothing, and shelter) have been taken care of:
Right now, graduates enrolled in the federal governments student loan Income-Based Repayment Plan make monthly payments of 15 percent of their discretionary income and all debt is forgiven after 25 years. Congress has already passed a law to change that program to require students to make payments of just 10 percent of their monthly discretionary income and to forgive the loan after just 20 years. That law will take effect in 2014 unless Obama has his way. The president would like to promote the start date to 2012. Hmm. What else happens in 2012?
Obamas politically-motivated plan to help college students repay their loans « Hot Air
10% of DISCRETIONARY income; then 20 years - bye bye.
Discretionary income is money you have after you've paid off all of your bills. Discretionary income is income after subtracting taxes and normal expenses (such as rent or mortgage, utilities, insurance, medical, transportation, property maintenance, child support, inflation, food and sundries, &c.) to maintain a certain standard of living.[5] It is the amount of an individual's income available for spending after the essentials (such as food, clothing, and shelter) have been taken care of:
Let's say, Johnny owes 120K and gets a decent job making 40K.
How much will he screw the taxpayers for?
Can someone help me with the math?
Take this example: If Suzy Creamcheese gets into George Washington University and borrows from the government the requisite $212,000 to obtain an undergraduate degree, her repayment schedule will be based on what she earns. If Suzy opts to heed the presidents call for public service, and takes a job as a city social worker earning $25,000, her payments would be limited to $1,411 a year after the $10,890 of poverty-level income is subtracted from her total exposure.
Twenty years at that rate would have taxpayers recoup only $28,220 of their $212,000 loan to Suzy.
As in the housing bubble, cheap credit on easy terms increases the amount of money chasing the product (in this case a diploma) allowing schools to increase prices. This inflation makes it harder for middle-class families to afford paying their own tuitions, driving them into the government financing program, which, you guessed it, drives up costs further still.
The best part for Obama is that he can obligate the Treasury without Congressional approval thanks to the passage of what he described as a cost-saving measure in 2009.
Read more: Obama Taps Taxpayers For Student Stimulus | Fox News
I think it's a good idea, a long overdue repair to a system that seriously needs repair
In fact, I don't think ithis FIX goes far enough.
It is criminally shortsighted of our society that our kids to come out post high school education burdened with extraordinary debts.
I think it's a good idea, a long overdue repair to a system that seriously needs repair
In fact, I don't think ithis FIX goes far enough.
It is criminally shortsighted of our society that our kids to come out post high school education burdened with extraordinary debts.
Blame the colleges. Prices have gone up twice the rate of inflation plus some. Why is there no discussion on that?
